Dan Haar: Union Guarantees Still Up In Air For Hartford's Downtown North Project

Dan Haar: On eve of vote, exactly how much of Hartford's Downtown North project is subject to union labor?

One of the most important questions about the $350 million Hartford Downtown North project — how much of the construction work will be guaranteed for union labor — remains up in the air as the city council prepares to hand Mayor Pedro Segarra the power to sign a deal.

This lapse seems odd considering all the scrutiny aimed at the project, especially the $56 million for a minor league ballpark funded by the city through a lease.

The council, which on Tuesday night is expected to approve the DoNo project, is considered pro-union, with six Democrats and three members of the Working Families Party. But the final resolution will most likely only require the developer to "enter into a project labor agreement," meaning some form of legally binding pact to assure union work, with details yet to be worked out.

Numbers bandying about are that 80 percent of the ballpark construction would be union, and the remaining $294 million worth of bricks and mortar would rise in the coming years with no assurance of union labor. Despite the lack of mandated assurance, the developer, DoNo Hartford LLC, is reaching agreements for some of the work, but not all of it, with skilled trades, including electricians and carpenters, said Shawn Wooden, the city council president.

At stake is more than just work guarantees for the unions. Organized labor has the training and apprenticeship pipeline, not to mention the oversight, to assure that the developer actually hits the threshold of 40 percent of the work going to city residents, a requirement that is part of the council's proposed resolution.

And with jobs at the center of the debate, it matters because a contractor hiring union tradespeople is, in effect, required to hire local residents because of territorial rights of the unions.

"A project labor agreement is actually an economic stimulus for your area," said Joe Toner, business agent for Ironworkers Local 15 that's based in Hartford.

The construction trades unions have offered strong support for the project and, naturally, are pushing hard for universal project labor agreements. But even though the council holds the power to make that happen, it's been slow going because union guarantees are a game of chicken. How far can the council push the developer?

Hartford's DoNo project works financially and economically only if it all gets built, and then only if it's fully rented and leased. A stadium, by itself, surrounded by surface parking lots, would cost city taxpayers millions of dollars a year with scant spinoff benefits. Likewise, the 673 apartments, the Thomas Hooker brewery, the supermarket and other storefronts and the 216,000 square feet of office and commercial space all need to play off one another.

And although the city can offer tax breaks and free land to DoNo Hartford, along with a lease that covers the developer's cost of building the stadium, it can't require that DoNo Hartford build any of those other pieces. An all-union deal, for all its value to the city, raises the construction cost.

"There are all sorts of debates about the increased costs of a project labor agreement," Wooden said Monday. "There was too much uncertainty that that would create for the entire project at this point."

He added that keeping as much as 20 percent of the ballpark work nonunion would help the city's contractors that are not unionized.

The council on Tuesday will receive the final version of an economic study by UConn's Connecticut Center for Economic Analysis, which will forecast the creation of 1,777 new jobs in the state in the peak year of the project, 2018, when the ballpark is up and running, residents live in first phase of apartments, the supermarket is opening and much of the rest if under construction.

Of those jobs, about 600 would go to Hartford city residents, largely through the construction work guarantee, said UConn economist Fred Carstensen, who heads the analysis center at Storrs.

After 2021, the DoNo project would generate about 1,150 new permanent jobs for the state, perhaps 400 of those in Hartford.

These jobs are not just the jobs at the site, which amount to a small number. They include positions created indirectly, as contractors and vendors spend money on materials and services, and what's called induced jobs, as the money paid to direct employees courses through the economy. And they are jobs above and beyond those that the current Double-A team, the New Britain Rock Cats, currently produce.

The assumptions built into the economic model are based on some of the Hartford construction work, but not all of it, going to higher-priced, locally based union labor. More union labor would raise the job-creation numbers and less would lower it, Carstensen said.

The UConn study does not attempt to measure the cost or benefit to Hartford taxpayers, only the overall effect on the region's economy. Clearly, if the project were to end up costing city taxpayers, say, $1 million a year, which could happen based on costs such as police protection, capital improvements to the stadium and site preparation work, then the cost per job would be high — $62,500 per job for 400 jobs if the city were to spend $1 million a year for the 25-year lease.

For the state, the calculation is much easier. The project, if it works, will create a windfall of jobs and tax revenues, all the more if DoNo Hartford uses more union labor, at a relatively low cost to state taxpayers. Gov. Dannel P. Malloy can't step in now because he's in the middle of a hotly contested election, but rest assured, the issue of state support for all of this will arise sooner or later.

Skeptics are going to send me emails and post disparaging remarks online no matter what, but let's be clear about what the UConn study says. The projected jobs will happen if and only if the whole plan succeeds — from construction through the crowds shopping at the supermarket, renting the apartments and cheering on the team.

"The only way that this works is if it works," Carstensen said. "You cannot develop one building and expect it to have any impact at all. … All the pieces have to fall into place, and it's a tough thing for a city like Hartford. Do we gamble at the table and see if we can do something?"

Wooden says he has the votes to move the bet forward. And the unions will continue to work toward the best deal for labor until the shovels hit the ground, long after Tuesday's council vote.